BARNSLEY, England, Feb. 15, 2016 /PRNewswire/ -- MAM Software Group, Inc. (NASDAQ Capital Market: MAMS) (the "Company" or "MAM"), a leading global provider of on-premise and cloud-based business management solutions for the auto parts, tire and vertical distribution industries, announced the following financial results in accordance with U.S. generally accepted accounting principles ("GAAP") for its second fiscal quarter ended December 31, 2015:

(In thousands, except share and per share data)

For The Three Months EndedDecember 31,

For The Six Months EndedDecember 31,

2015

2014

2015

2014

Revenues

$

7,901

$

7,871

$

15,896

$

16,078

Gross profit

$

4,333

$

4,662

$

8,678

$

9,564

Operating income

$

758

$

1,128

$

1,782

$

1,940

Income before provision for income taxes

$

931

$

1,127

$

1,945

$

1,935

Net income

$

738

$

925

$

1,568

$

1,534

Earnings per share attributed to common stockholders – basic

$

0.06

$

0.07

$

0.12

$

0.11

Earnings per share attributed to common stockholders – diluted

$

0.06

$

0.07

$

0.12

$

0.11

Weighted average shares outstanding – basic

12,907,105

13,423,060

13,150,831

13,310,927

Weighted average shares outstanding – diluted

13,005,870

13,554,977

13,247,978

13,405,524

Michael Jamieson, MAM's President and Chief Executive Officer commented, "We continue to make progress in transitioning to a cloud-based business model, while simultaneously and effectively managing multiple, large-scale implementations for our customers. During the quarter our recurring revenue grew to an all-time high of 80% of total revenue, reflecting our customers' enthusiasm for our offerings. Organic revenue growth of 4% was again offset by a significant foreign currency impact from our U.K. business. Despite this, the climate for cloud-based business solutions in the automotive vertical remains positive, as SaaS revenue grew 45% year-over-year and 11% sequentially. Taking everything into account, we are pleased with the progress made during the quarter. The large scale projects that we are focusing on today will help position us for future growth and we remain very excited about the opportunities in front of us."

Second Quarter Highlights:

Revenues were $7.9 million versus $7.9 million for the same period last year. On a constant currency basis, total revenues would have been $8.2 million, or an increase of 4% over the same period last year.

Recurring revenues were 80% of total revenues compared to 74% of total revenues for the same period last year.

Total Software as a Service (SaaS) revenue increased 45% year-over-year and 11% sequentially.

Operating income was $758,000, or 10% of revenues, versus $1.1 million, or 14% of revenues, for the same period last year.

Adjusted EBITDA* was $1.3 million, or 16% of revenues, versus $1.5 million, or 19% of revenues, for the same period last year.

Net income was $738,000, as compared to $925,000 in the same period last year.

Second Quarter Financial Results:

Revenues were $7.9 million for the quarter ended December 31, 2015, versus $7.9 million for the same period last year, an increase of $30,000.

On a constant currency basis, revenue was up 4% over the same period last year.

Recurring revenue for the quarter was $6.3 million, or 80% of total revenues, an increase of $470,000 or 8%, over $5.8 million, or 74% of total revenues, for the same period last year. Sequentially, recurring revenue increased $46,000, or 1%, compared to $6.3 million in the fiscal first quarter of 2016. The increase was due to the transition to Software as a Service (SaaS) model.

Total Software as a Service (SaaS) revenue for the quarter was $1.7 million, an increase of $528,000, or 45%, year-over-year, and an increase of $163,000, or 11%, sequentially when compared to the fiscal first quarter of 2016. The increase in the SAAS revenue was primarily attributable to a 29% increase in Autowork Online (SaaS) revenue for the quarter to $1,059,000, and an 83% increase in Autopart Online (SaaS) revenue for the quarter to $642,000.

Total Data as a Service (DaaS) revenue for the quarter was $2.4 million, an increase of $22,000, or 1%, year over year, but a decrease of $115,000, or 5%, sequentially when compared to the fiscal first quarter of 2016.

Gross profit for the quarter was $4.3 million, or 55% of total revenues, a decrease of $329,000 compared to $4.7 million, or 59% of total revenues, for the same period last year. The decrease in gross profit margins was primarily the result of an increase in lower margin equipment sales in the three months ended December 31, 2015, higher margin special project revenue in the same period last year, and an increase professional services headcount to support growth.

Operating expenses for the quarter increased by $41,000 to $3.6 million, an increase of 1% as compared to the $3.5 million for the same period last year. An increase in research and development expenses from additional resources to support new client developments was offset by lower sales, marketing and administrative expenses.

Operating income for the quarter decreased by $370,000, or 33%, to $758,000, as compared to $1.1 million, for the same period last year.

Other income for the quarter included a $217,000 gain from the settlement of liabilities with certain vendors and net interest expense of $44,000 primarily as a result of borrowings incurred in connection with a tender offer.

Net income for the quarter decreased by $187,000, or 20% to $738,000, or $0.06 per basic and diluted share, compared to net income of $925,000, or $0.07 per basic and diluted share, for the same period last year.

Year-to-Date Highlights

Total revenues were $15.9 million, a decrease of 1% compared to $16.1 million in the same period last year. On a constant currency basis, total revenues would have been $16.6 million, or an increase of 3% over the same period last year.

Recurring revenues were 79% of total revenues compared to 73% in the same period last year.

Total Software as a Service (SaaS) revenue increased 44%.

Operating income was $1.8 million, or 11% of revenues, versus $1.9 million, or 12% of revenues, for the same period last year.

Adjusted EBITDA* was $2.5 million, or 16% of revenues, versus $2.6 million, or 16% of revenues, for the same period last year.

Net income was $1.6 million as compared to $1.5 million in the same period last year.

Second Quarter Year-to-Date Financial Results:

Revenues were $15.9 million for the six months ended December 31, 2015, versus $16.1 million for the same period last year, a decrease of $182,000, or 1%.

On a constant currency basis, revenue was up 3% over the same period last year.

Recurring revenue for the six months was $12.6 million, or 79% of total revenue, an increase of $764,000, or 6%, over $11.8 million, or 73% of total revenue for the same period last year.

Total Software as a Service (SaaS) revenue for the six months was $3.2 million, an increase of $985,000, or 44%, year-over-year. The increase in the SAAS revenue was primarily attributable to a 28% increase in Autowork Online (SaaS) revenue for the six months to $2.0 million, and an 82% increase in Autopart Online (SaaS) revenue for the six months to $1.2 million.

Total Data as a Service (DaaS) revenue for the six months was $4.9 million, an increase of $57,000, or 1%, year over year.

Gross profit for the six months ended December 31, 2015 was $8.7 million, or 55% of total revenue, a decrease of $886,000, compared to $9.6 million, or 59% of total revenue, for the same period last year. The decrease in gross profit margins was primarily the result of an increase in lower margin equipment sales in the six months ended December 31, 2015, higher margin special project revenue in the same period last year, and an increase professional services headcount to support growth.

Operating expenses for the six months ended December 31, 2015 decreased by $728,000 to $6.9 million, a decrease of 10% as compared to $7.6 million for the same period last year. The decrease was primarily the result of an increase in the capitalization of payroll costs of engineering personnel, adjustments to the management incentive plan, realignment of the U.S. management structure in 2015, and strategic goal incentives in the first quarter of last year.

Operating income for the six months ended December 31, 2015 decreased by $158,000, or 8%, to $1.8, as compared to $1.9 million, for the same period last year.

Other income for the six months ended December 31, 2015 included a $217,000 gain from the settlement of liabilities with certain vendors and net interest expense of $54,000 primarily as a result of borrowings incurred in connection with a tender offer.

Net income for the six months ended December 31, 2015 increased by $34,000, or 2%, to $1.6 million, or $0.12 per basic and diluted share, compared to net income of $1.5 million, or $0.11 per basic and diluted share, for the same period last year.

Balance Sheet and Other Financial Highlights:

The Company finished the quarter with $1.3 million in cash after capital expenditures and capitalized software development costs of $1.4 million and utilizing $4.5 million of cash to fund a portion of the repurchase of 2,000,000 shares of common stock for a total purchase price of $15 million in a public tender offering.

As of December 31, 2015, the Company had $10.5 million of debt outstanding under its $12 million credit facility, which was used to fund a portion of the tender offer.

Stockholders' equity decreased $14.3 million, or 78%, to $4.1 million as a result of the tender offer.

System backlog was $1.9 million, with more than half of this business expected to be fulfilled during the next six months.

As of December 31, 2015, MAM Software had 12.4 million shares of common stock outstanding.

"By completing the tender offer of two million shares during the quarter, we demonstrated our commitment to returning capital to our shareholders and better aligned our capital structure in light of the current interest rate environment and the future growth opportunities we believe are before us," added Brian Callahan, MAM's Executive Vice President and Chief Financial Officer.

Business Outlook 2016

The Company's previously announced expectation for fiscal year 2016 Adjusted EBITDA* in the range of $5.8 million to $6.0 million was based on various assumptions including the foreign currency exchange rates. Based largely upon the continuing impact of foreign currency exchange rates, the Company now expects Adjusted EBITDA for fiscal year 2016 to be in the range of $5.0 million to $5.2 million.

Conference Call Information

The Company has scheduled a conference call for Tuesday, February 16, 2016, at 9 a.m. ET to review the results. Investors and interested parties can access the conference call by dialing:

Toll-Free: 888-430-8694

Toll/International: 719-325-2281

UK Toll-Free: 0 800 404 7655

A replay will be available until February March 1, 2016 by calling 877-870-5176 (United States) or 1-858-384-5517 (toll/UK/international). Please use pin number 6564992 for the replay.

A live webcast as well as a replay of the call will be accessible at the investor relations section of the Company's website, www.mamsoftware.com. The replay will be active for 60 days following the conference call.

About MAM Software Group, Inc.

MAM Software is a leading global provider of on-premise and cloud-based business management solutions for the auto parts, tire and vertical distribution industries. The company provides a portfolio of innovative software (SaaS and packaged), data (DaaS), and integration (iPaaS) services that enable businesses to intelligently manage core business processes, control costs and generate new profit opportunities. MAM's integrated platforms provide a wealth of rich functionality including: point-of-sale, inventory, purchasing, reporting, data and e-commerce. Wholesale, retail and installer business across North America, the U.K. and Ireland rely on MAM solutions, backed by dedicated teams of experienced service and support professionals. For further information, please visit http://www.mamsoftware.com.

*Adjusted EBITDA is defined as earnings before interest, taxes, depreciation and amortization adjusted to exclude non-cash equity compensation. A reconciliation of adjusted EBITDA to net income (loss) can be found at the end of the following tables. Adjusted EBITDA is commonly used by management and investors as an indicator of operating performance and liquidity. Adjusted EBITDA is not considered a measure of financial performance under GAAP and it should not be considered as an alternative to net income (loss), or other financial statement data presented in accordance with GAAP in our consolidated financial statements.

Safe Harbor Statement

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Readers are cautioned not to place undue reliance on these forward-looking statements. Actual results may differ materially from those indicated by these forward-looking statements as a result of risks and uncertainties impacting the Company's business including, increased competition; the ability of the Company to expand its operations through either acquisitions or internal growth, to attract and retain qualified professionals, and to expand commercial relationships; technological obsolescence; foreign currency fluctuations; general economic conditions; and other risks detailed from time to time in the Company's filings with the Securities and Exchange Commission.